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Changing Higher Education



Major changes occurring in the world are redefining the metrics of excellence for higher education.



Updated: 2016-08-31T05:26:00-07:00

 



The high cost of funded research in colleges and universities

2016-11-28T14:41:13-08:00

A college or university that does research ends up spending considerable resources of its own even when most of its research is “funded”. How and why is this the case, and where does the institution look to find the resources...A college or university that does research ends up spending considerable resources of its own even when most of its research is “funded”. How and why is this the case, and where does the institution look to find the resources needed to cover this unfunded research cost? Undergraduate tuition seems like one likely source.   These internal research expenditures fall into two categories, which I will call “open” and “hidden”. As these terms may suggest, the first is a set of costs that are reported nationally by the NSF and consequently appear in numerous reports put out by the institutions themselves. On the other hand, hidden costs are well known, but seldom openly discussed even thought they contribute very significantly to the institutional cost of research . OPEN COSTS Funding for research in higher education comes from many sources as described in the NSF Higher Education Research and Development (HERD) Survey for 2015: Higher Education R&D Expenditures by source (in Millions of current dollars )   Federal State Business Nonprofit All other TOTAL EXTERNAL Institutional TOTAL RESEARCH 2010 37,475 3,852 3,198 3,740 1,048 49,313 11,940 61,253 2011 40,767 3,829 3,179 3,854 1,037 52,666 12,610 65,276 2012 40,140 3,695 3,271 4,023 968 52,097 13,633 65,730 2013 39,445 3,653 3,506 3,889 1,537 52,030 14,985 67,015 2014 37,923 3,869 3,725 3,980 1,905 51,402 15,754 67,156 4 year % change 1.20% 0.44% 16.48% 6.42% 81.77% 4.24% 31.94% 9.64% These data include medical schools, which contribute about $23B to the Total Research column in 2014. Medical schools are organized and financed very differently from the rest of the university; conclusions drawn from these overall numbers should therefore be understood with that caveat. “Institutional” is the sum spent by universities and colleges from their own resources on research. Note that while the Federal support has oscillated somewhat but overall flat, the Institutional component has grown steadily as a percentage of the Federal:   Institutional as a % of Federal         2010 31.86%   2011 30.93%   2012 33.96%   2013 37.99%   2014 41.54%     That is, by 2014 the universities contribution to research from their own resources was almost 42% of what the Federal government contributed. A more complete picture of the institutional cost of “externally funded” research is:   Institutional as % of External     2010 24.21% 2011 23.94% 2012 26.17% 2013 28.80% 2014 30.65% Or, for every $1,000 an institution gets from external funders for research, on average the institution ends up spending $306 of its own internal resources. Obviously, the institutional cost of externally funded research is growing steadily over time. As the HERD survey shows, the total increase in Institutional support from internal funds over this 4 year period was about $3.8 B, or almost 32%. However, most of the components of institutional support arguably are necessary to enable the institution to attract the externally funded research - a cost of doing business. The 2015 HERD survey breaks down the components of Institutional support over time:    Totals for the numbers in this graph are slightly different from those shown in the table above. The table above included data from all 891 institutions t[...]



California still not addressing the workforce gap - plus ca change

2015-10-29T17:14:20-07:00

Five years ago in a post, I described a thesis study by Lauren Cooper on potential solutions to the looming workforce gap in California. Her analysis was based primarily on projections of California workforce needs in 2025 made by the... Five years ago in a post, I described a thesis study by Lauren Cooper on potential solutions to the looming workforce gap in California. Her analysis was based primarily on projections of California workforce needs in 2025 made by the Public Policy Institute of California (PPIC). Dr Cooper's analysis of the CSU - level workforce shortfall suggested that CSU needed to open 12 new campuses by 2025 to meet needs - an unlikely solution to the problems given the finances of California. PPIC has just published an updated California workforce projection, this time aiming at 2030 needs. The new projections are similar to the earlier ones: Our projections indicate that the demand for college graduates will outpace the supply by 2030, if current trends continue. The gap is substantial, with the economy needing 1.1 million more college graduates than the state will produce. But if the state, its educational institutions, and its people are able to improve educational outcomes, California and its residents will experience a much more successful future, with higher incomes, greater tax revenues, and lower use of social services. Pretty much what we saw 5 years ago. Very few steps have been taken over this period to improve the situation, despite some strong efforts by Governor Brown to create movement. The key to a better future for California residents is obviously the California public university sector. Thus far, that sector has proclaimed loudly and consistently that it cannot increase the number of graduates significantly without proportional increases in budget, i.e. it cannot find more effective and more efficient ways of educating students. This position is of very questionable merit, since numerous institutions around the country have rethought their educational approaches in order to increase participation without sacrificing educational outcomes - and in many cases have improved educational outcomes in the process. But the bottom line remains, California's future prosperity is largely in the hands of a public higher education system that thus far has fiercely and successfully defended the status quo, supported by regents who view their job to be to protect the university rather than the State and its citizens. Surely, there is a responsible adult somewhere in the mix. [...]



MIT's self-disruption: an update

2015-10-09T16:34:49-07:00

In The future of MIT undergraduate education: a case study of disruption, I described two reports from MIT that laid out a stunning vision for the future of MIT undergraduate education. Among the suggestions of the reports are that education...In The future of MIT undergraduate education: a case study of disruption, I described two reports from MIT that laid out a stunning vision for the future of MIT undergraduate education. Among the suggestions of the reports are that education of the future will be unbundled and disaggregated, with online components enabling flexible time scales and location-independent participation. The second and final of the two reports calls for, among other things, bold experimentation to realize the vision,  and a recommendation that MIT move forward to consider the types of certifications that can be supported through MITx and edX.  MIT recently announced a very interesting new program that embodies these two aspects of these reports: a new twist to MIT's one year Master's in Supply Chain Management. This modified degree program is, in effect, modularized and disaggregated. The first semester's courses will be available through edX, enabling students around the world to access them for free. Students who do well in the courses, pass a proctored exam and pay a small certification fee will be awarded a new MITx MicroMaster's certificate. For those students who want to continue with the full Master's program, the MicroMaster's greatly enhances the likelihood of acceptance into the on-campus program. Accepted students could then complete the Master's in one semester on campus.  MIT describes this as an example of "inverted" admissions in which students first try the courses, then apply for admission:  Inverted admission has the potential to disrupt traditional modes of access to higher education....We’re democratizing access to a master’s program for learners worldwide. Students who enter the program in this way will be charged only for their one semester on campus, saving half the price of the traditional program. One can only imagine that MIT views this as a way to do a great study of the effectiveness of their brand of online learning versus traditional classroom learning: which group of students does the best in the second semester?  And what of the student demographics? Does this approach bring increased geographic or gender diversity to the class? When the reports referred to above were first released, Anant Agarwal, CEO of edX and Professor at MIT, imagined a future MIT where freshmen would spend the first year taking on line courses, then come to campus for (most of) the remainder of their degree. This new program also should be providing useful data for considerations of that future. Finally, the MITx MicroMaster's itself is an important step. This is a credential that MIT expects will have career value for those who have earned it. That is, employers will value it and reward its holders appropriately. Thus, the program is structured so that it can create value even for those students who decide not to continue to the Master's.  In addition, MIT is actively discussing with other universities the possibility of having the MicroMaster's convertable into credits in their own Master's programs. In other words, MIT is hard at work creating a name brand for its MITx MicroMaster's: "The new MicroMaster’s is an important modular credential for the digital age, and promises to serve as academic currency in a continuous, lifelong-learning world,” says Anant Agarwal, CEO of edX and a professor of electrical engineering and computer science at MIT. “It also affords an evolutionary path for universities in the face of mounting costs, and a way to leverage technology to blend online and on-campus learning pathways.” Is this the beginning of the creation of a second brand at MIT?   [...]



"Baumol's cost disease" is the answer to a different question

2015-07-29T12:17:04-07:00

In 1966, William Baumol and William Bowen looked at the origins of rising salaries for live performances (music, theater, dance), and noted that an underlying issue was that such performances could not easily be made more efficient - productivity could...In 1966, William Baumol and William Bowen looked at the origins of rising salaries for live performances (music, theater, dance), and noted that an underlying issue was that such performances could not easily be made more efficient - productivity could not be increased (Baumol and Bowen, Wikopedia). The oft-quoted ( and quite convincing) formulation of this concept is that a Beethoven quartet must be performed by exactly the same number of musicians today as was required in the 19th century, and that the quartet requires roughly the same amount of time to perform. No increase in productivity over two centuries! This inability to increase productivity should, according to simple economic arguments, lead to flat incomes - rising income usually is a result of increased productivity. However, despite this, salaries in the performing arts had risen over time. Baumol and Bowen concluded that this occurred because it was necessary to keep salaries on a par with those in industries that were seeing productivity increases in order to keep workers in the performing arts. This "push" of salaries in industries without productivity increases is called Baumol's cost disease. Very often, when someone poses the troubling question, " why is college so expensive?", the response is simply "Baumol's cost disease", said with an authority that suggests that should settle the discussion. In fact, used in this way, Baumol's cost disease is like the magician's gesture that is designed to get the audience's attention away from place where something important is happening. In reality, customer's don't care about the cost of making a product, they are concerned about the price they must pay, and that difference leads one down a potentially fruitful path of reflection about both Baumol's formulation, and critical issues in higher education. When increases in productivity are difficult or impossible to achieve, the price of the product often can be controlled by spreading the costs over more consumers without raising costs proportionally. In the case of Baumol's Beethoven quartet, by increasing the size of the performance hall, more customers can share the costs of the concert, thus decreasing the cost/attendee (although net costs increase because the larger hall likely costs more to rent). This trick is used in higher education, of course - we move the lecture to a bigger hall. However, technology also enables the concert performance to be "repurposed" for a variety of different, expanded audiences. For example, the the concert can be broadcast over radio or tv, carried over the internet to be shown "live" in movie houses, and recorded for later play on CDs or mp3. Each of these repurposings has additional costs associated with it, of course, and so the final costs for each includes the cost of both the original performance and the intervening technology and personnel. Each aspect of the repurposing is worth doing financially (there may be other reasons, such as reputationally) only if it helps to increase overall net revenues. It is worth noting that Baumol and Bowen's cost analysis focused only on the original performance, not its repurposing. Most of the repurposed performances have shown enormous productivity increases over the past decades because of their large technology component. Thus only the original component - the actual performance in a concert hall- is trapped in the land of no productivity increases.  Each of these repurposings is different from the original- hearing the quartet played in a small hall with 60 other people is very different from playing an mp3 of the concert in your car as you drive to work. But "different" does not necessarily mean inferior. Clayton Christensen argues that[...]



Whither alternative (and improved) credentialing?

2015-06-15T12:14:16-07:00

I recently served on a panel at a meeting organized by the California Higher Education Innovation Council to look at "Alternative Credentials and Unbundling the Degree: Meeting Employer Needs or Short-Circuiting Proven Approaches?" Our panel was challenged beforehand by its... I recently served on a panel at a meeting organized by the California Higher Education Innovation Council to look at "Alternative Credentials and Unbundling the Degree: Meeting Employer Needs or Short-Circuiting Proven Approaches?" Our panel was challenged beforehand by its moderator, Ryan Craig, to imagine how conditions had to change over the next decade in order for alternative credentialing ("e.g. nanodegrees and badges" according to the meeting invitation) to become a major force in higher education. I will make no attempt to review the many arguments advanced on this subject at the meeting, but simply describe some of my own thoughts (however tentative) that were stimulated by this challenge. There are obviously three broad constituencies interested in questions of higher education credentialing: students, government, and employers. My belief is that the most important of these in determining whether alternative credentialing takes hold will be employers: if employers find it truly useful, most students will enthusiastically sign on, and government will see little reason to block something that employers and students find to be of real value.  Clayton Christensen's "Jobs to be Done" approach emphasizes that to understand an issue such as this, one must understand the problem that the customer (employers in this case) are buying the product (higher education credentialing) to solve. I think the primary answer is rather simple: employers are "buying" higher education credentialing to help maximize the probability that a new hire or a promotion will work out well for their company. There is an interesting extension of this, however, articulated by Frank and and Cook in The-Winner-Take-All-Society  two decades ago: if the hire does not work out, management is significantly shielded from blame if they hired the person with the most prestigious and established credentials. In order to maximize their probability of success in hiring and promotion, employers need to get as much information as possible about the skills and capabilities of their applicants. Those might be divided roughly into three categories: 1)subject matter scope and mastery (e.g, level in economics); 2)higher order intellectual skills (e.g. critical thinking, postformal reasoning, creativity); 3)personal characteristics (e.g. perseverance, ability to work in groups, honesty, competitiveness). Different jobs obviously would lead to different weightings of the importance and applicability of these categories in the eyes of the employers. Present credentialing, in the form of a degree and transcripts, is a rather blunt instrument for providing the desired information. For the relatively rather small fraction of the roughly 4,500 accredited institutions that are very selective, the degree signifies that the graduate was among the very best high school students in the nation the year that she graduated. For that subset, the degree also often tells something about the students underlying interests and strengths (a student who chooses Yale vs one who opts for MIT). For the majority of students who come from rather non-differentiated, non-selective institutions, little information of these types is contained in the degree. For students from all institutions, the degree shows a level of perseverance, and names the major and the level (e.g.Master's in Economics). However, similar designated degrees signify greatly different things from different institutions (and probably even for two students from the same institution), and supporting information in the form of a transcript is pretty useless in teasing out desired information. What does an A or B in intermediate economics[...]



Arizona State University and edX open a new frontier- maybe

2015-04-24T17:31:25-07:00

Arizona State University (ASU) and edX recently announced a joint project to offer an online freshman year with full official credit from ASU - The Global Freshman Academy: “We’re going to have 12 new courses, of which students will take...Arizona State University (ASU) and edX recently announced a joint project to offer an online freshman year with full official credit from ASU - The Global Freshman Academy: “We’re going to have 12 new courses, of which students will take eight,” Mr. Crow (President of ASU) said. “They have to be constructed at a fantastic level of digital immersion, not just talking heads. This is a general education freshman year, not a series of disconnected courses, so they have to be thought through together.” All courses will be designed and taught by leading faculty at ASU. Whether the Department of Education bugaboo of competency based testing will be used is not clear from information I have seen.  This is truly an "open admissions" program, with no entrance requirements. Students pay nothing to take the courses, only paying after successful course completion if they desire to get ASU credit. Projected cost for the credit will be no more than $200 per credit hour. The combination of relatively low cost, online accessibility and convenience, and college credit from a major institution certainly make this a great experiment, and may well make this a very successful program.  ASU has a strong existing online program with focused and strong student support that has led to an astounding 89% retention rate. Should similar rates be obtained in the Global Freshman Academy, it would be a first for MOOC-like courses.  A few years ago, I thought a new age was dawning with the establishment of Semester Online - a consortium of almost a dozen highly ranked institutions that would be offering a number of credit bearing courses online.This, I thought, could be the beginning of an experiment to allow students to customize their own educations. Unfortunately, that consortium was rather short lived, in large part because of objections from faculty at the member institutions, and the experiment died. ASU and edX have restarted that experiment by offering students an alternative way to pick up the often-generic first year of college. Another radical thing is happening in this program, if Crow's statement above is correct. The general education program is being thought of as a whole, rather than as a set of barely connected courses - an approach greatly encouraged by extensive educational research, but hardly ever seen in the actual world of higher education where "academic freedom" ensures that faculty teach what they will. This general education program could become a model of how general education should be done!. [...]



Cost allocation in the research university and what it tells us

2015-03-02T12:18:18-08:00

Universities often report a number that appears to indicate how much the university spends on instruction. We might believe that this number accurately represents teaching expenses and even do some analysis based on that belief. We would be wrong to...Universities often report a number that appears to indicate how much the university spends on instruction. We might believe that this number accurately represents teaching expenses and even do some analysis based on that belief. We would be wrong to do so.  John V. Lombardi, in How Universities Work This somewhat cynical observation by Lombardi was informed by his broad and sometimes painful experiences as Provost at Johns Hopkins University, President of the University of Florida, Chancellor of the University of Massachusetts at Amherst, and President of the Louisiana State University System. However, in these times of heated discussions over who should pay for higher education and a background of rapidly increasing student debt,  it is important to have some idea of what the actual costs of producing that education are. In this post, I review some of the reasons why it is difficult to define the instructional costs at a research university, and why various constituencies might not want that information to be generally available. After discussing how a business model view simplifies some of the issues around calculating instructional costs, I describe a recent analysis of such costs in the University of California system, which reaches some surprising conclusions. These conclusions lead to a consideration of why cost -shifting between missions is so important in the current approach of the research university. Taken together, these results suggest that one of the key issues that should be focused on in order to control higher education prices are the synergies between the different functions of the research university and the actual "added value" to the customer of those synergies. In particular, the analysis suggests that rising prices in undergraduate education are not likely be controlled unless society finds alternative ways to fund a significant component of the cost of university research.  ****** Readers of this blog know that Disrupting College by Clayton M. Christensen, Michael B. Horn, Louis Caldera and Louis Soares (CHCS) reveals some key aspects of the operations of a research university. In particular, CHCS show that the research university operates three different generic types of business models simultaneously as it carries out its missions of teaching, research, and social growth of students. This type of multiple business model operation leads to very high operational overhead rates, leading to high costs. In part this overhead is due to the fact that the constraints imposed by operating several business models simultaneously means that no one of the models can be optimized with respect to cost. It is important to recognize that these constraints also make it impossible to optimize any of the models with respect to quality of output. Thus, one part of the difficulty of defining educational costs is the interlocking business models that lead to individuals and facilities being used in multiple activities. In addition, as I pointed out in A business model view of changing times in higher education : ...when running several business models simultaneously, there is great opportunity for cost shifting from one component to another when the organization wants to discreetly cross subsidize activities. It thus becomes very difficult, if not impossible, for customers to understand exactly what they are paying for. That is, some of the difficulty in determining costs of individual components of the operation is that we prefer it that way - it lets us put our thumbs on the scale to reflect the way we in higher education prioritize the component activities of the university. We ena[...]



An update on StraighterLine - a "disruptor in the making"?

2015-03-16T14:25:58-07:00

A few years ago, I identified a few organizations that I thought were doing things in higher education that were examples of approaches that potentially could be disruptive to the field (Potential disruptions in the higher education space). Among these... A few years ago, I identified a few organizations that I thought were doing things in higher education that were examples of approaches that potentially could be disruptive to the field (Potential disruptions in the higher education space). Among these is StraighterLine, which offers primarily introductory level college courses much more inexpensively and flexibly than traditional colleges and universities.  Entry level courses are relatively similar in many if not most colleges, and at the same time are the most profitable for the colleges because they are most often taught in large classes. If students in large numbers were to opt for the StraighterLIne combination of online convenience and low cost, it would prove quite disruptive to the budgets of many traditional institutions.  Time has moved on since my original designation of StraighterLine as a potential disruptor, and an update is called for to see if StraighterLine continues to look like a disruptor. For context, it may be useful to review some of the steps Christensen has identified in the development of a disruptor. The typical disruptor begins by using a new approach to make a product that is decidedly inferior to the existing dominant product, but which has some characteristics that are different from those of the dominant product. Almost always the approach is one that leads to a less expensive product.  However, If this new product is "good enough" to meet the needs of some set of customers, it will sell despite being inferior as judged in the dominant market. Most often this set of customers is composed of those whose needs are not met by traditional products ("nonconsumers"), or for whom the traditional product does the job but with too many expensive and unneeded "bells and whistles" ("overserved"). If the new product does find a market, then the producer has the financial resources to improve the product over time. The product thus increasingly becomes comparable in quality to the dominant product, but at lower cost. In the final stage of disruption, the traditional customer base finds the quality and price combination of the new product to be superior to the quality and price combination of the old product, and move rather swiftly to the new product. As Christensen points out, this entire process can sometimes be quite rapid, but often takes many years to reach the tipping point. So how does StraighterLine fit this scenario? StraighterLine's concept was to use online courses obtained from outside vendors rather than having a traditional faculty and facilities, and to use a radically different- and lower- pricing model. There have always been and always will be complaints about its educational quality that are motivated by the fact that it doesn't do things in the "correct" way using the right business model.  In earlier times there were also reasonable complaints about the quality of some of its courses. Nonetheless, it found students who valued the freedom offered by the flexible online programs and the low price.True to the disruption model, over time this customer base has enabled (and encouraged) StraighterLine to continuously improve the quality of its courses. The primary provider of online course material is McGraw Hill, and the courses are outcomes based, thus enabling students to move at their own pace. The Council for Aid to Education provides many of the learning assessment tests used to measure student outcomes. StraighterLine now has a partnership with Carnegie Mellon's Acrobatiq,  a pioneer in outcomes-driven adaptive courseware; together, they are working to bring this powerful approach[...]



The problem with CA higher education is that no one asks what the problem is

2015-01-05T17:23:38-08:00

The advertisements in a newspaper are more full of knowledge in respect to what is going on in a state or community than the editorial columns are. Henry Ward Beecher The editorial board of the Los Angeles times weighed in...The advertisements in a newspaper are more full of knowledge in respect to what is going on in a state or community than the editorial columns are.Henry Ward Beecher The editorial board of the Los Angeles times weighed in on December 29 on the funding situation of the UC system with Finally, UC gets budget attention  . This latest Times editorial joined earlier ones about the UC in demonstrating a certain naivety on the part of the Times editorial board in matters of higher education in California. The editorial strongly supports President Napolitano's solution to the UC problems - send more money - and egregiously mischaracterizes Governor Brown's proposals as "mechanistic". If only the UC issues were simply about "budget"! The research university provides many critical societal benefits, but it also provides the most expensive collegiate education yet invented. The American research university grew up during the last 60 years, which was a period when the American economy moved strongly upward on the average. The latter part of this period was also a time in which many individuals and governments spent even more than they made, funding desired activities with increasing debt. As a society we became unsustainably over-leveraged. Governor Brown has made some efforts to cut back on California's enormous overspending and overcommitting, but he has only scratched the surface and more radical steps are likely to be necessary in the future. Return to the halcyon days of yore is highly unlikely!   There is no rational reason to believe that the research university generally and the UC specifically has magically reached its optimal organization and mission either under the former "flush"times of spending, or the new "realistic" times of spending. Thus preserving the status quo of the UC should not be a priority - the priority should be to evaluate how the UC can best be organized to meet California's current and future needs, priorities, and resources, and then working toward that forward-looking organization. ****** What should be the key roles of a public research university in California? Others will certainly have their own lists, but mine is topped by the obligation of the of the public university to provide education and research needed to support the health of the economy in the state. The education component must relate to both the number of people educated, and the quality of the education.Many of the other roles that a public university should play, such as enabling and encouraging economic and social mobility, are closely tied into this role. Without trying to be exhaustive, here are four issues that must be addressed if the UC is to play this key role effectively in the future:  1.One of the 800 lb gorillas typically ignored in budget discussions around the UC is the future workforce needs of California. The Public Policy Institute of California estimates that by 2025, California will have a shortfall of about 1 million college graduates compared to the needs of California's increasingly complex economy. Since roughly 75% of bachelors degrees in California are produced by the UC and CSU, it is obvious that the UC must take the lead in meeting this shortfall. It is equally obvious that the UC with current organization and approach can only provide the necessary ramp-up in degrees if resources are greatly increased - which is highly unlikely to occur given all the competing (and increasing) pressures for state funds. (In the present budget kerfuffle, Napolitano is proudly promising an expansion of 5,000 slots system wide. That is just a "round-off" change compared to th[...]



A business model view of changing times in higher education

2014-12-13T17:46:32-08:00

As my regular readers know, I have written several posts that utilize a business model approach to look at one aspect or another of higher education. Last year, readers suggested that I combine several of these posts in an article...  As my regular readers know, I have written several posts that utilize a business model approach to look at one aspect or another of higher education. Last year, readers suggested that I combine several of these posts in an article that would combine multiple threads - ideally in a coherent fashion! The resulting article has found a good response among policy and institutional leaders, and so I thought that some of my other readers might also find it interesting. I have pasted it in below. For those who would prefer it in PDF, they can Download Business model view of change. Curiously, the original document contains Endnotes that were stripped out by Typepad, but they are not crucial to the arguments.  ********** Changing times in higher education viewed through the prism of the business model Lloyd Armstrong Summary: The environment for higher education in the United States is changing rapidly. The effects of this changing environment will not be the same at all institutions, however. This article uses a business model approach to look at some of these environmental changes from a perspective that gives leaders tools to better understand how various changes might impact their own institutions, and how they might best respond.       I.Change and more change in higher education The world of higher education recently seems to be inundated by waves of change. We have had to learn a number of new nouns describing environmental changes, such as MOOCs, competency based degrees, prior learning assessment, adaptive learning, alternative credentials, and flipped classrooms, many with their own verb forms. The economic picture has been dominated by two recessions in the past decade, with an accompanying significant repositioning of the role of US in the world. Real family income has been flat or decreased over that period for the vast majority of families, and family wealth has taken a significant dip. As a result, the ever-increasing real costs of higher education have become ever more onerous. Not surprisingly, we have seen an almost unprecedented agreement between the Democratic and Republican leadership that real increases in tuition must stop, and noted the not-unrelated fact that student loan debt now exceeds $1T, exceeding that for credit cards or automobiles. On the for-profit side of higher education, we have seen the "1st generation" companies get hit very hard by student recruiting and debt issues, but have also seen the rise of "2nd generation" companies such as University of the People, University Now and the Minerva Project that seek to provide a college degree much more cheaply than the 1st generation – sometimes for free. Other 2nd generation companies such as StraighterLine are focusing on some component of the undergraduate degree, typically the first 2 years, where they promise a much less expensive alternative to that offered in the non-profit sector. Book publishers such as Pearson and McGraw are morphing into online course providers, using increasingly sophisticated pedagogical approaches to present courses based on the materials provided by the best professors in the country. Adaptive learning is joining with big data to enable personalized approaches to education. Knewton, a leader in this field, is playing a major role in the growth of ASU Online. Recently, Pearson partnered with Knewton in order to give a major boost to the pedagogical effectiveness of its own online courses. All of this has led various observers to predict tsunamis, tipping points, crises, and/or disruptions for higher education. Is there a wa[...]